Wages: Who the Hell Do We Believe?

Friday, December 08, 2006

Wages: Who the Hell Do We Believe?

Within the space of 24 hours, these two news stories about the wages of U.S. workers were published. First, an article from CNNMoney.com:
Employers are working hard to keep a lid on wage increases — and to a large extent they're succeeding .... Tuesday's government report on productivity and labor costs showed that hourly wages rose 4.3 percent in the third quarter from a year earlier, the lowest gain so far this year ...

"I'm befuddled. I would have expected to see larger increases too, but I would have expected to see them in 2006 as well," said Joe Kilmartin, director of compensation at Salary.com, a company that tracks pay and related issues for employers and workers.
Now, the other article, which appears in today's New York Times:
After four years in which pay failed to keep pace with price increases, wages for most American workers have begun rising significantly faster than inflation.

... the buying power of American workers is now rising at the fastest rate since the economic boom of the late 1990s.

... “The labor market is pretty tight right now, so it’s not a huge surprise that we’ve started to see big wage gains,” said Nariman Behravesh, chief economist for the research firm Global Insight.

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